The Ghanaian cedi has been on a rollercoaster ride in recent times, with its value fluctuating wildly against major currencies. However, according to economist, Dr. Adu Owusu Sarkodie, the cedi is finally adjusting to its true market value after being manipulated for far too long.
Speaking in an interview, Dr. Sarkodie noted that the cedi’s recent depreciation was not a cause for alarm, but rather a correction of the market forces that had been artificially suppressed. “The cedi was overvalued for a long time, and this led to a lot of speculation and manipulation in the market,” he explained.
Dr. Sarkodie attributed the cedi’s overvaluation to the government’s attempts to artificially prop up the currency through various means, including the use of foreign exchange reserves. However, this strategy ultimately proved unsustainable, and the cedi’s value began to decline.
Despite the challenges posed by the cedi’s depreciation, Dr. Sarkodie believes that the adjustment is necessary for the economy to recover in the long run. “The cedi’s depreciation will make our exports more competitive, and this will help to boost economic growth,” he said.
The economist also noted that the government’s decision to allow the cedi to float on the market was a step in the right direction. “This will help to reduce speculation and manipulation in the market, and it will also help to attract more foreign investment into the country,” he explained.
In conclusion, Dr. Sarkodie’s assessment of the cedi’s adjustment to its true market value is a welcome development for the economy. While the short-term effects of the depreciation may be painful, the long-term benefits of a more competitive export sector and reduced speculation in the market will ultimately outweigh the costs.
As the government continues to implement policies aimed at stabilizing the economy, it is clear that the cedi’s adjustment is just one part of a larger strategy. With the right policies in place, Ghana can overcome its current economic challenges and emerge stronger and more resilient than ever before.
The cedi’s depreciation has also had a significant impact on the country’s import bill. With the cedi’s value declining, imports have become more expensive, and this has led to a significant increase in the cost of living. However, Dr. Sarkodie believes that this is a short-term problem that will be resolved once the economy adjusts to the new exchange rate.
In the meantime, the government is working to implement policies that will help to reduce the impact of the cedi’s depreciation on the economy. This includes measures to increase the supply of foreign exchange, as well as initiatives to promote exports and reduce the country’s reliance on imports.
As the economy continues to adjust to the new exchange rate, it is clear that the cedi’s depreciation is just one part of a larger story. With the right policies in place, Ghana can overcome its current economic challenges and emerge stronger and more resilient than ever before.
The government’s decision to allow the cedi to float on the market has been welcomed by many economists, who believe that it will help to reduce speculation and manipulation in the market. This, in turn, will help to attract more foreign investment into the country, and boost economic growth.
In the end, the cedi’s adjustment to its true market value is a necessary step towards a more stable and prosperous economy. While the short-term effects may be painful, the long-term benefits will ultimately outweigh the costs. With the right policies in place, Ghana can overcome its current economic challenges and emerge stronger and more resilient than ever before.
Source: Africa Publicity
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